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Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Bank of Marin in Focus
Headquartered in Novato, Bank of Marin (BMRC - Free Report) is a Finance stock that has seen a price change of -11.36% so far this year. Currently paying a dividend of $0.25 per share, the company has a dividend yield of 3.03%. In comparison, the Banks - West industry's yield is 2.57%, while the S&P 500's yield is 1.56%.
Looking at dividend growth, the company's current annualized dividend of $1 is up 6.4% from last year. Bank of Marin has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 12.95%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Bank of Marin's current payout ratio is 36%, meaning it paid out 36% of its trailing 12-month EPS as dividend.
BMRC is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $2.89 per share, which represents a year-over-year growth rate of 9.47%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, BMRC is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).
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Bank of Marin (BMRC) Could Be a Great Choice
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Bank of Marin in Focus
Headquartered in Novato, Bank of Marin (BMRC - Free Report) is a Finance stock that has seen a price change of -11.36% so far this year. Currently paying a dividend of $0.25 per share, the company has a dividend yield of 3.03%. In comparison, the Banks - West industry's yield is 2.57%, while the S&P 500's yield is 1.56%.
Looking at dividend growth, the company's current annualized dividend of $1 is up 6.4% from last year. Bank of Marin has increased its dividend 4 times on a year-over-year basis over the last 5 years for an average annual increase of 12.95%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Bank of Marin's current payout ratio is 36%, meaning it paid out 36% of its trailing 12-month EPS as dividend.
BMRC is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $2.89 per share, which represents a year-over-year growth rate of 9.47%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, BMRC is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).